What’s Next For Panama City Real Estate?
In many ways, 2015 was a key year for Panama City’s real estate market. There was a return to normalcy, as more and more buyers from around the world decided the local market represented a solid investment. The result was a steady increase in sales activity and pricing, driven by investors, second home buyers and families relocating to Panama.
Market activity was nothing like the boom years, when speculators ruled the market. Instead, people were buying after making sound, rational decisions, based on an array of positive market conditions, including the strength of Panama’s economy. As the government continued to invest in infrastructure, including the region’s first metro system and new highways, more multinational corporations increased their local presence, fueling both the sales and rental markets.
As a result, there was a healthy uptick in both sales transactions and pricing. In popular buildings in Punta Pacifica, the waterfront community of skyscrapers, prices for the best apartments rose 6 to 8 percent in 2015, as the inventory of available units continued to shrink.
The year ahead is shaping up as an exciting period for Panama City real estate. Moving into 2016, it’s time to take a look in the crystal ball:
Final Trump Apartments
The final developer-controlled apartments in Trump Ocean Club will sell out, creating in an instant pop in pricing for resale apartments. Of the 635 apartments in Trump, only about 30 are left for sale.
Prices on the Move
Consistent demand and shrinking supply will push home prices higher. The average sale price for apartments in Punta Pacifica will hit $2,800 a square meter, up from the current level of about $2,500 a square meter. (That doesn’t include the Trump, where prices are closer to $3,300 a square meter.)
The development of the Amador Causeway as an investment destination continues, with more projects announced to take advantage of its beauty and strategic location. President Varela will fulfill his promise to make Amador a new tourism and cultural hub for the city.
International developers will return to Panama City. There are already a few projects offering pre-construction sales, as developers see buyers gobbling up remaining apartments. But in 2016 more big name developers will announce projects and offer pre-construction deals, a sign of a healthy property market.
Panama Canal Expansion
The expansion of the Panama Canal, one of the biggest construction projects in Central American history, will be completed in 2016, opening a new era for commerce in Panama. The bigger ships will spur the local expansion of international companies.
More European Buyers
An increase in direct air connections and growing awareness of Panama’s attributes will draw more buyers from Europe. Rising prices in Miami and other destinations will prompt many investors to look for better yields in a stable environment.
At Punta Pacifica Realty, we’re looking forward to an exciting, rewarding year. All economic indicators suggest Panama City will continue to grow and prosper as the capital of Central American business. Punta Pacifica Realty is poised to capitalize on this continued robust economic growth having grown its staff in both the sales and property management departments in 2015, and actively recruiting associates into 2016.
Jeff Barton is managing director of Punta Pacifica Realty, a Panama real estate agency focused on Punta Pacifica, the exclusive neighborhood of 18 towers perched on the edge of the Pacific Ocean.